You have to really want to retire early if you want your goal to come true. Normally, early retirement needs to be well planned out, saved for and scheduled. Me? I retired early by the seat of my pants. After suffering a saddening financial blow to my computer company from the Dot Com disaster of 2000-2001, I also got hit with the attack on the World Trade Center on September 11, 2001. My finances were depleted and the fear for the future of my family was also in shambles. By this stage of the game, all I wanted was out of the Rat Race. I was fifty years old, tired, disgusted and the only path I saw ahead in my future was retirement. I no longer had the will to work nor earn a living. If you check back to my Part One (click here) you’ll understand why.

When my business failed in 2000-2001, I was hit with several financial disappointments. To make a long story short (because this part of the equation I do not want to delve in to) I had my car repossessed, my boat repossessed, my personal savings and personal checking accounts seized as well as an eminent foreclosing hovering around in the mist. I went from grossing $2,000,000 a year to barely making $500 a month. No one was buying computers and I was stuck with a huge Christmas/Holiday inventory supply and its related overdue bill. In retrospect, when I look back on these financial woes, I think, they were, for me, the much needed impetus to compel me to successfully retire early. I realized that my debts and high credit card balances were just a mirage of a fantasy lifestyle. Technically, I didn’t own a thing. The banks did. And as we all are learning now during these pandemic years, a financial disaster doesn’t have to be your fault. It also isn’t wise to be in any consumer debt. I realized that my life was just rented. It wasn’t real.

I wanted a more sustainable, authentic life. I wanted out of the rat race. I hated working. Now, how do I get myself out of this mess?

The first thing I did was take a step back and look at my own life objectively. What did I still have? What did I lose? What were my priorities? How did I envision my future? How did I want to move forward and begin again? The only assets I still had (but were nearing foreclosure proceedings) were my two homes. I owned a vacation townhouse up in the Catskill Mountains in upstate New York. I owned a residential home on Long Island, NY. I tried to rent them out but that wasn’t a good idea. My only alternative was to put them up for sale, accumulate whatever equity I could and forge a path towards early retirement.

THE BASIS FOR A GOOD RETIREMENT (IMHO) IS A PAID-FOR, MORTGAGE FREE HOME!

Once the dust settled I did NOT have the millions of dollars most financial experts recommend for retirement. My homes sold quickly, both at excellent prices but once I paid off my liabilities, I hadn’t much left over. The worst liability were the taxes: I owed $14,000 in sales tax BUT with all the fees, penalties and interest, the end financial balance due came to $167,000. Yes! You read that correctly. I had a $14,000 liability and owed $167,000 by the time the tax authorities got through with me. Throw in $30,000 for the attorney defending me, and I was looking at a deficit of almost two hundred thousand dollars ($200,000) before I even started to contemplate or plan out a retirement.

I used the equity left over from the town house to buy 3.5 acres of land in upstate New York for $51,000 cash. Life (and taxes) were much cheaper in the agricultural section of NY. I used the equity left over from the sale of my residential home (after paying off all my liabilities) to custom build a modular home ($176,000) on the untouched land. We couldn’t afford the construction costs of a stick built home, thus the modular choice. My husband never oversaw a home being built before, but he learned along the way.

Here we are, in 2001-2002, standing in front of a mud pit, a recently excavated, rock and shale infested piece of land that was to be the basis of our new home. If we looked a little bit shell shocked and dismayed, we were:

Our biggest obstacle was building a home debt free in 2001-2002. This was almost unheard of at the time. But my husband and I were determined to never go in to debt again. We knew the perfect retirement base for our lives going forward had to be that paid-for home! Total building costs (clearing the land, getting the proper permits, specking out the land for proper home placement, putting in a driveway, drilling for a well, putting in a septic system, bringing in new electricity, pouring a foundation and then having the home delivered, mounted and finalized came to $176,000 back in 2002. Today those costs would be well over $600,000 and counting.

Don’t ask me how we ever completed building our own home. My husband basically did it alone. He connected all the plumbing and electrical as well as be the General Contractor. We closed on the land in March. We moved into the modular home in June. We didn’t have front, back or side stairs. We used to climb into the house up a ladder. But since we had no mortgage, we didn’t need a C of O (Certificate Of Occupancy) so we muddled along. And muddle we did. The Cape Cod styled home sat on a pile of mud. As with all home construction jobs, we ran out of money. We needed a $200 part to get the heat operational and didn’t have it. Winter was fast approaching. My daughter gave us the money to buy the part and the next day we had a blizzard. We had heat just in time!

Here is an early shot of our newly constructed, modular home. We only had the 1st floor finished: four rooms, 1120 sq feet, consisting of a bedroom, bathroom, office and an open air styled kitchen and dining area. The house sat on a pile of mud as we ran out of money. That white stuff is snow.

Part of the equity plan was to buy ourselves two used, smallish cars and to set up two rather smallish retirement accounts for each of us. Once that was done, I’m sorry to say that unfortunately my husband and I had no more money. We were flat broke. It wound up that my husband would be out of work for the next 2.5 years. No matter how hard he tried, he couldn’t even get a job pumping gas or delivering pizzas. His resume’ showed he was an executive and no one would hire him. That meant that I had to go out and find a job.

Mentally, I wasn’t ready to go back to work but I had to because we had bills to pay. I’m sad to say that I went through a series of six jobs before my husband finally landed a position and I could actually quit and retire. I would only last 2 to 6 months at each job. I hated everybody and everything. Personally, I found everyone to be stupid! I was in the middle of God’s Country and most people, to me, were backward, unsophisticated and uneducated. After coming from a high-end computer background, I had employers who were still using the DOS system on their computers!!! It was frustrating to say the least and an enormous set back for me. But I plugged along.

In 2004, my estranged father, who was now facing his own death wanted to see me. He had my sister drive him to my new home. My dad could barely walk but he looked around at our property, came inside our home, we shared a meal, we made up and he made a promise to me. He told me that upon his death, he was leaving me enough money to finish my home. My dad kept his word. My father passed in 2005 and he left me enough money to finish my home. As a bonus, there was enough money left over to take me and my whole family to Italy for 15 days and visit the hometown where my dad was born. It was a moving experience. My husband, two daughters and I met my father’s entire family left back in Italy and we all became life long friends still to this very day.

Here is a photo of our finished home back in 2005-2006. Notice the addition of the 2nd floor side window. We were able to finish the 2nd floor and add in two bedrooms and a full bathroom for when my daughters came to visit.

I knew for a good, steady sustainable early retirement our main goal was to own our own home, debt & mortgage free. Once that basis was established, I thought the rest of the puzzle would be easy. I was wrong. Very wrong. We didn’t have the necessary funds to properly early retire. I thought I could wing it. I was partially right. I thought I could play catch-up with our savings through real estate investment. Before I go any further, both you and I know that sometimes doesn’t work out too well. Over the past twenty years I bought two real estate properties, all also for cash. The beach house I bought in Newport Rhode Island lost me $100,000 when I sold it ten years later. I did a little bit better with my 2nd real estate investment. We bought a condo in Sarasota Florida, thinking we’d wind up living there full time but after 1.5 years that investment went sour too. We sold, made a small profit. Either way it doesn’t matter because I still never accumulated enough money in savings to sustain an early retirement lifestyle.

Yet, here we are. Still living in New York in our now, apparently, forever home.

My husband’s newfound job only lasted eight years before his boss went belly up. I was 62 and compelled to file for early Social Security Benefits because we needed the money. I thought our future saving grace would be hubby’s filing for his own Social Security benefits at the proper full retirement age of 65 (thus getting us more monthly income) but the current 2021 pandemic proved me wrong on that premise too. Hubby’s self-employment dried up. He filed for SS benefits at age 63.5 thus locking both of us in to a much lower annual income. Hubby does have a small pension which luckily makes up the difference but again, he filed for it early because again, we needed the money, thus we receive less than what we anticipated.

So, how have I managed to remain early retired with such an unsteady stream of income? How have we both managed to live a sustainable, retired lifestyle with so much success? How did we go from a zero FICO score to over 820 for each of us yet never borrow money? How the heck have we both lasted these last twenty years with so much financial turmoil in the world? I’ll answer those questions and more in Part Three.

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